Looking for a slice of the Blackberry pie

Source: By Wang Xing (China Daily)

BEIJING - The Canadian smartphone maker, Research In Motion (RIM), said its consumer business is expected to overtake its corporate element in China during the next three to four years, as the company plans to launch individual business services early next year in the country.

Gregory Shea, president of RIM in China, told China Daily that he is very optimistic about non-business Chinese consumers purchasing the Blackberry handset, which has enjoyed great popularity among corporate users globally.

'This year and the next is the beginning of our consumer business here, and if everything works well we will probably end up seeing our consumer work overtaking the enterprise business,' he said.

Shea said during the past three years, RIM has seen the global numbers of business users grow three times faster than those of consumer users. However, that situation now seems to be reversed, 'Now it's like three consumer users for every one business user,' he said, noting that China will probably follow a 'similar pattern.'

Although it began providing services in the Chinese market in 2006 through a partnership with China Mobile, RIM did not offer its first handset in the world's biggest cell phone market until 2008, and its user group has long been limited to executives in multinational companies.

That made RIM's share in China's cell phone market almost 'negligible', according to Pang Jun, an analyst from the research firm GFK China.

But this year, RIM has accelerated the pace of domestic expansion, in common with rivals such as Apple and Motorola, which are both expanding aggressively in China.

In May, RIM established a $100 million venture capital fund that will invest in the world's largest cell phone market. The company also opened its first retail store in Beijing in July.

Shea said that, after intensive localization efforts in the years since it entered China, RIM is expecting to see increasing growth in the country.

'This year we have seen accelerating growth in China,' he said, noting that the company plans to further expand in second- and third-tier Chinese cities during the coming years.

According to figures from GFK China, smartphone sales account for nearly 15 percent of total domestic phone sales, whereas in the United States, the figure is 30 to 40 percent. However, the sector is expected to grow rapidly as more Chinese users begin to adopt 3G services.

This year, Chinese shipments of cell phones are expected to rise to 30 million, from just 10 million in 2007, according to GFK China. That will create huge opportunities for companies such as Apple, Motorola, Nokia and Samsung.

'If Blackberry wants to compete with the iPhone or Android-phones in China, it needs to launch more services that appeal to individual users,' said Pang from GFK China, adding that RIM also needs to intensify its partnership with Chinese telecom carriers to deliver services to a wider domestic user-base.